The TC Palm: All Aboard Florida bond sale deadline extended 6 months

Posted on June 23, 2015

Lisa Broadt

All Aboard Florida has another six months to sell its $1.75 billion of tax exempt bonds, a Federal Railroad Administration spokesman said Monday.

A July 1 deadline — set last year by the U.S. Department of Transportation — had loomed over the company, threatening its chance to sell the private-activity bonds.

The company now has until Jan. 1.

The money would be used for construction on parts of All Aboard Florida’s $3 billion Miami-to-Orlando passenger rail service, which would send 16 daily round trips through the Treasure Coast.

It would be the second-largest private-activity bond award in the country, behind only the $2 billion approved for the Interstate 4 project in Orlando, according to the Department of Transportation.

But All Aboard Florida is about two years behind its original schedule: Service between Miami and Orlando is said to begin in late 2017, not late 2015 as first announced by the company.

Service between Miami and West Palm Beach  — where construction already is underway — could begin in early 2017, according to All Aboard Florida.

Three times, the company has missed self-imposed deadlines to begin bond sales.

In September, it promised to sell its bonds by the end of 2014. But Jan. 1 came and went with no updates.

It then missed self-imposed June 8 and June 22 deadlines, and has announced no new target date.

The missed bond sales are, at least partially, tied to postponed meetings of the Florida Development Finance Corp., the quasi-governmental agency that would rule on the bonds and possibly issue them.

The finance corporation’s approval is a prerequisite to sales — the department of transportation is responsible only for preliminary approval — and without its blessing, All Aboard Florida cannot begin sales.

The corporation has canceled meetings scheduled for May 28 and June 10 and has no new meeting set.

The scheduling challenges could benefit Martin and Indian River counties’ legal battle against the passenger rail project.

Preventing bond sales is crucial, because, according to the counties, All Aboard Florida needs the funding to proceed.

In similar lawsuits filed earlier this year, the counties argued that blocking the bonds would stop the project — and its corresponding harm to communities and the environment — long enough for new, crucial environmental information to come to light.

Following a May 29 hearing in Washington, D.C., a federal court judge said the counties failed to make their case that blocking the bonds would stop the project, and ruled against them.

At the very least, the latest delays indicate that the counties — despite that loss — are on the right track, according to Indian River County Attorney Dylan Reingold.

“It’s evidence of the work we’ve done,” Reingold said Monday about slowing down All Aboard Florida’s progress.

The county now is seeking access to All Aboard Florida financial documents and communications to better prove its case. Judge Christopher Cooper is expected to rule next month on the county’s request.

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